The Malaysian arm of the world’s largest Islamic bank seems to be pulling out all the stops to unveil a digital bank this year, moving in lockstep with its Saudi parent which has embarked on its multiyear Bank of the Future strategy to become digital-ready.
In its latest of a string of digital partnerships and initiatives, Al Rajhi Bank Malaysia (ARBM) has engaged technology and software engineer GFT and management consulting firm Oliver Wyman to design, build and launch a cloud-based Islamic digital bank, which will see ARBM overhauling the design of its products, services and channel for this planned virtual bank. Europe-based GFT worked with designing and bringing to market Mox, a mobile bank in Hong Kong.
This follows the recent appointment of its new head of digital bank, Ikram Khaliq, who relocated to Kuala Lumpur from the UK to lead the digital endeavors of the bank. ARBM also secured a new office space it inaugurated last month to house the digital division along with other divisions. The Islamic bank has also engaged other partners including Thought Machine to realize this project.
ARBM has invested “significantly” in laying the foundation for its digital bank, said Arsalaan Ahmed, CEO of ARBM. The mobile bank, slated for launch in 2022, will offer products for the retail and SME segment.
The bank’s assertiveness in launching a digital bank comes at a time of a changing banking landscape in Malaysia. The Southeast Asian nation, widely acknowledged as a leading Islamic finance hub by its global peers, is expected to welcome up to five digital banks this year under the purview of Bank Negara Malaysia. Attracting entities from a range of sectors, the regulator had also received bids from several with an Islamic ambition when it opened its digital bank license applications last year.
Meanwhile in Saudi Arabia, where ARBM’s parent operates, the Kingdom recently welcomed its third neobank. Keeping up with its ‘unbank the bank’ spirit. Al Rajhi Bank has also implemented an array of digital initiatives including acquiring a technology company in January to support its digital ambitions.